September 24, 2014 - No. 77

Organize for People's Empowerment!
Defeat the Neo-Liberal Austerity Agenda!

Premier Declares Alberta
"Under New Management"

Organize for People's Empowerment! Defeat the Neo-Liberal Austerity Agenda!
• Premier Declares Alberta "Under New Management" - Peggy Morton 
• Prentice Government Hits Pause Button on Pension Assault

Education Is a Right!
• Society Must Provide the Right to Education with a Guarantee - Kevan Hunter

Public Right Not Monopoly Right!
• Oppose the Deregulation, Privatization and Sellout of Alberta's Electricity - George Allen

Organize for People's Empowerment!
Defeat the Neo-Liberal Austerity Agenda!

Premier Declares Alberta "Under New Management"

- Peggy Morton -

Newly installed Alberta Premier Jim Prentice was sworn in on September 15 and quickly declared that Alberta is "under new management." His first act was to announce a new cabinet, discarding those most closely associated with the Redford regime. The new Ministers of Health and Education are unelected. Prentice also announced a "transition team" with only one elected member, his new Minister of Finance Robin Campbell. The others in the team include the former CEO of Imperial Oil, a former executive of TransCanada and a corporate lawyer whose profile states he advises both industry and government on energy and real estate matters. Prentice then prorogued the Legislature. A new session will now begin on November 17 instead of October 27.

Prentice is wielding his far-reaching prerogative powers to do away with the veil of democratic governance. He was installed as Premier after some 17,000 people voted for the new leader of the PC Party, far less than one per cent of the Alberta electorate. Unfolding events showed that even the PC caucus in the Legislature is not in control, much less the PC party.

After 43 years in power in which membership in the PC Party was a requirement for doing business, the PC Party itself has become dysfunctional, a problem not just of the PCs but the entire cartel party system. Citizens have become depoliticized along with the public interest while private interests are politicized. Private monopoly interests such as Imperial Oil/Exxon, Suncor, CNRL, TransCanada and Enbridge to name a few, as well as the banks with which they are merged, and the global construction contractors are wielding political and economic power directly.

The Premier and his cabinet members, but not his transition team, will have to obtain seats in the Legislature through by-elections. This does not change the fact that a coup has been carried out without even the appearance of "free and fair elections."

Prentice acts as if he has engineered a hostile corporate takeover. It is direct rule by the most powerful monopolies, through an unelected Premier, unelected Ministers in the key portfolios of health and education, and a transition team recruited directly from the executives and directors of the most powerful monopolies. He has not just fired the old cabinet, which is his prerogative as Premier, but is essentially firing MLAs as well, who are all going to take it on the chin "for the good of the Party" because they have no choice.

Prentice is also taking action to remove some of the most contentious items of the Redford agenda. The PCs thought they could impose their neo-liberal austerity agenda through force and violence, but the working class and people militantly defended their rights. Prentice is now taking action to calm things down and put a smiling face on the neo-liberal agenda of austerity and nation-wrecking in order to eliminate the resistance of the working class and First Nations.

Prentice's agenda is to restructure the state in the form of the United States of North American Monopolies. He must strive to line up the working people and their organizations behind the narrow interests of the monopolies, not for nation-building and the public interest.

The opposition parties appear unwilling or unable to act as a real opposition. Wildrose is making a bit of noise for an immediate election because this suits its partisan interests. The Liberals and NDP seem content to nip at the heels of the Prentice dictatorship but not to alert and engage the polity in discussion of the significance of the events. The NDP ruminated over the loss of "experienced" ministers while having nothing to say about what agenda these ministers implemented while in power. The Liberals made silly statements about whether the former Edmonton Mayor had been good at fixing potholes. It is as if there is no relation whatsoever between form and content, a disconnect used by Wildrose in particular to hide that it shares the same anti-social, anti-worker agenda.

The concentration of power and smashing of all the old forms and system of governance serve the neo-liberal anti-social agenda. The people, not the political parties, must wield power. Political power must not represent just a privileged few who abuse their power to trample on the rights of all and serve the narrow private interests of the most powerful.

Prentice Government Hits Pause Button
on Pension Assault

Defend the Pensions We Have; Fight For Pensions For All!

Public sector workers in Alberta, as across Canada and for that matter the entire working class, have waged a strong fight to defend the pensions they have and fight for pensions for all. Through the Alberta Labour Coalition on Pensions, workers and their organizations demanded that the Alberta government scrap Bill 9, the Public Sector Pension Plans Amendment Act, 2014, and Bill 10, the Employment Pension (private sector) Plans Amendment Act, 2014.

The PC government of Jim Prentice announced on September 18 that the second session of the 28th Legislature would be prorogued. This means that Bills 9 and 10 die on the order paper. Prentice also stated that he would not re-introduce the bills when the Legislature begins a new session on November 17.

At the same time, Prentice sent a "mandate letter" to Finance Minister Robin Campbell instructing him to "address the competitiveness of the public sector pension plans and ensure they are sustainable." (Emphasis added.) The "mandate letter" is a clear signal that the Prentice government has not abandoned its assault on public sector pensions.

The previous Redford government tried to justify Bill 9 as necessary to ensure that pension plans are "sustainable." It had previously requested the boards governing the plans to address the issue. The boards responded that they had already taken action to reduce and eliminate the plans' unfunded liabilities but the government went ahead anyway with its pension attacks.

Prentice has brought out this overused notion of "sustainability" and added another code word, "competitiveness." "Sustainability" and "competitiveness" are to be used to push the anti-social agenda, "pensions for none."

Public sector workers have forced the government into temporary retreat, but this does not mean that the assault on pensions is over. The Alberta government will no doubt continue to look for ways and means to restructure the pension funds to achieve what it wants. Federal and provincial governments are launching assault after assault on workers' pensions to eliminate defined benefit pension plans and security for workers in retirement. Instead, workers are told to accept savings funds and defined contributions as pensions and reject the concept of defined benefits.

Even the governments' own experts warn that no individual or even group savings can guarantee retirement security. Savings depend on two factors: firstly, sufficient disposable income while working, which is far from guaranteed, and secondly, working people depriving themselves of buying goods and services in the present, which damages both their individual interests and the economy.

Savings including defined contributions as a form of retirement security also depend on an absence of economic crises or downturns in the future, which is impossible under the capitalist system. Only the broad sweep and power of governments to claim value from the economy can guarantee defined pension benefits and for this to happen the government must be pro-social and recognize retirement security as a right.

Bills 9 and 10 are dead. The fight for pensions and the right to dignity and security in retirement is very much alive. Let us use this space to go on the offensive. Many workers put forward proposals in their submissions to the Standing Committee on Alberta's Economic Future. They spoke with one voice to say they will not accept dictate, and to demand a real say in governance. They demanded that the government stop privatizing public services and restore privatized services as public enterprise.

Many workers called for defined benefit pensions for all, and that everybody in Canada should be in a defined benefit pension plan to provide security in retirement for all. How could this be accomplished? If people are forced to depend on individual or group savings or defined contributions for their retirement, this can only give rise to disasters.

Even if workers manage to save, which many cannot, these "savings" can be gobbled up by the rich and go up in smoke in the next financial meltdown. All this propaganda about saving for retirement is harmful, anti-social and in contradiction with the way the modern economy functions. We live in a socialized economy where working people work collectively to produce the value on which everyone and society depends. Pension benefits for retirees do not come from savings; they come from goods and services produced in the present by the next generation of workers.

A pro-social alternative would be for government guaranteed defined pension benefits for all to come out of general revenue collected from companies based on their gross income. In such a situation, government, company and individual pension plans would not be necessary. The government in practice would guarantee the right of Canadians to defined pension benefits at a standard of living they attained during their working lives with an established minimum. Let's discuss!

Education Is a Right!

Society Must Provide the Right to Education
with a Guarantee

- Kevan Hunter -

With the start of a new school year, many parents are raising the issue of the hundreds of dollars per child they must pay in school fees. School fees are a violation of the right to education, which must be both free and public. They place a heavy financial burden on many families and have to go. School fees are a user fee and an inherently regressive form of taxation, as they are levied on all parents of school-aged children equally regardless of ability to pay, with the exception of the very poorest of the poor.

In the Calgary public system, as an example, parents may have to pay $330 for school busing, $220 for noon-hour supervision (up to Grade 6), up to $130 for instructional supplies and materials (such as textbooks and photocopying), totalling as much as $680 per student. Across the province, school boards collect an estimated $100 million in school fees. Additional fees are levied for field trips and programs such as music. Fee waivers exist for parents below a certain income, and it is board policy that students cannot be prevented from going on a field trip for lack of ability to pay.

Opposition parties are also taking up this issue. On September 2, the Wildrose Party launched a petition campaign calling for the government to prevent school boards from charging fees. The Alberta NDP also issued a statement calling on government to eliminate school fees. NDP Education Critic Deron Bilous provided some context, explaining, "In the absence of stable funding for Alberta public schools, the government continues to pass its financial responsibility onto Alberta families and that is not fair."

In contrast, the Wildrose petition takes the issue of user fees out of context, so as to divert from discussing the solutions needed to fully fund education. The Wildrose presents itself as the champion of parents who are increasingly squeezed by recent fee increases. However, it appears to be of no concern to the Wildrose Party how the multi-million dollar shortfall is to be made up, so long as there is less of a burden on "taxpayers."

Education as a cost or burden is a recurring theme that the working people must reject with contempt. Education of the younger generation and others throughout their lives is not a cost, but an investment, which is returned in greater value to the economy and society. Just imagine how impoverished the country would be without mass public education.

The Wildrose stand is also hypocritical. When leader Danielle Smith was a columnist for the Calgary Herald, she authored a column entitled, "The unreasonable demands of education." She wrote, "Parents have two options. They can find a way to live with the resources taxpayers already devote to education, or they can pay for these extras themselves." Now it appears she has taken the second option off the table, and parents and students should simply be left to suffer with an inadequately funded system.

In Alberta, the power of taxation was removed from the hands of school boards during the Ralph Klein years. The government decides how much money to transfer to school boards, and school boards are put in the position of sorting out how to meet the needs of students with the increasingly inadequate funding they receive. Deprived of any real power, they have become middle-managers for a government that acts on behalf of the most powerful monopolies, which have their own designs on the wealth created by the workers and transferred to the government through taxes.

When the Wildrose makes an issue of school fees, it forms part of a broader agenda of the monopolies to erode further the power of school boards, leading to their total abolition in favour of centralized control by the government. Such a move would place education under the control of the most powerful monopolies, which salivate at the prospect of increasingly opening up education as a market for private profit.

A modern, rational discussion of funding for education would take as its starting point that education is a right and society must provide the right with a guarantee. Within this discussion, the suggestion that education is a cost to the economy or society in general, which should be contained for the benefit of taxpayers, must be denounced as retrogressive and unscientific. The education system generates tremendous benefit and value for the entire society, which requires educated citizens and productive workers with a certain level of skill for its survival and development. Without a modern education system and the value teachers and education workers produce, society would simply collapse.

The issue is not one of taxes at all but how the value from education is to be exchanged with other sectors and individual parts of the economy and realized. Other sectors and parts of the economy are required to exchange the value their workers produce for the value teachers and education workers produce within the education sector, and which exists as actual and potential capacity in educated working people.

In particular, it must be noted that the monopolies receive enormous benefit from the educated workers they employ and the research and innovation those workers provide, based in large measure on the education they have received. The monopolies must realize the education value they consume through the work of their employees and stop denying their responsibility to ensure the public education system is properly funded.

Public Right not Monopoly Right!

Oppose the Deregulation, Privatization and
Sellout of Alberta's Electricity

- George Allen -

By the end of 2014, Alberta's main electricity transmission company, AltaLink, will be completely in the private hands of U.S. monopoly Berkshire Hathaway (BH), owned by billionaire Warren Buffet.

Based in Iowa, Berkshire Hathaway Energy owns and operates approximately 284,000 kilometres of transmission lines in the United States and owns or contracts more than 28,000 megawatts of electricity generation.

AltaLink is one of Canada's largest transmission companies. It operates 11,800 km of transmission lines and 270 substations in Alberta sending energy to about 85 per cent of Albertans.

Seventeen companies supply electricity into the Alberta transmission grid. Five of those providers, ATCO Power, Enmax, Capital Power Corporation, TransAlta and TransCanada Corporation, supply about 80 per cent of the province's generation capacity. Alberta's transmission grid, owned in sections by companies such as AltaLink, ATCO Electric, and TransAlta then carries electricity produced by generating providers to wholesale electricity purchasers or retailers who in turn sell electricity to customers.

The sale of AltaLink to BH was announced on May 1. AltaLink's previous owner, engineering monopoly SNC-Lavalin, is selling the company for $3.2 billion. SNC-Lavalin made AltaLink a fully owned subsidiary in October 2011.

AltaLink took control of the electricity transmission system from previous owner TransAlta in 2002 following deregulation. AltaLink was quickly exposed as having close connections with Alberta's Tory government. The senior VP was also VP of the Tories for the Calgary region, while another AltaLink executive was married to the senior official in charge of provincial transmission policy.[1]

ATCO, a monopoly owned by Alberta's powerful Southern family, also made bids to buy AltaLink from SNC-Lavalin. ATCO, founded in 1947, delivers electricity in Alberta, Yukon and Northwest Territories; processes and delivers natural gas in Alberta; generates electricity; and manufactures modular buildings, mainly for industrial sites. ATCO Electric serves nearly 220,000 customers in 245 Alberta communities.

An inter-monopoly fight broke out over the control of AltaLink. The Chair of AltaLink (connected with SNC-Lavalin) opposed the ATCO bid, stating it would give ATCO "a virtual 100-per-cent control of transmission in Alberta" whereas the takeover by the giant U.S. monopoly BH would somehow increase competition. ATCO denied the allegation of complete control and to curry favour for its own bid used a series of public ads to raise the issue of foreign control of Alberta's electricity.

The Harper dictatorship through Industry Canada has already rubber stamped the sale of AltaLink to BH. It still requires the approval of the Alberta Utilities Commission (AUC), which is responsible for regulating electricity in Alberta, but this is expected to be automatic.

The AUC was created in 2008 out of the Alberta Energy and Utilities Board. The Board itself was the result of a 1995 merger of the Public Utilities Board and the Energy Resources and Conservation Board. The stated responsibility of the AUC is to "regulate the utilities sector, natural gas and electricity markets to protect social, economic and environmental interests of Alberta where competitive market forces do not." The AUC declares itself to be independent and objective but is widely seen as an arm of the Tory government, which itself acts as the champion of the monopolies,

In Alberta, the Alberta Electric System Operator (AESO) is responsible for planning Alberta's transmission system and the operation of the Alberta Interconnected Electric System (AIES). The Alberta Minister of Energy appoints the members of AESO's Board. Self-declared as independent of outside influence, AESO is overseen by a Board of Directors drawn almost entirely from industry executives, including Alberta-based energy monopolies such as TransCanada Corporation, TransAlta, Canadian Turbo, AltaGas, and coal giant Luscar. The routine claim of independence of these government boards begs the question: independent from what, the monopoly controlled economy and politics of class privilege in which they exist.

The operation of the provincial regulator in the service of private monopolies has been an ongoing theme in Alberta. In 2007, a series of corruption scandals on transmission approvals forced the breakup of the province's energy regulator. The subsequent passage of Bills 19, 36, and 50 limited public discussion of transmission issues and concentrated all decision-making in the provincial cabinet.

Regulation, who decides and who controls those issues that affect the people's lives and economy have become major issues regarding the province's plan to build $16.5 billion worth of transmission lines. The government is thinly disguising the project's main purpose to export power to the United States. This plan involves building eight times the existing transmission infrastructure at public expense with no public assessment of need. The plan originally included a proposal to give away the infrastructure to ATCO and AltaLink, along with a promised rate of return of nine per cent. The energy regulator was exposed as hiring private investigators, many of them armed, to actively spy on landowners opposed to the line. Instead of acting in the public interest, the government reacted to public opposition by lashing out against it and passed Bill 46 in 2007. The bill struck down a section of provincial law requiring the government to demonstrate the need for transmission projects now and in the future.

Until 1995, Alberta's electricity market was highly regulated, including control of prices. Electricity rates were set by a central regulator using a cost-of-service model. Under the Tory government of Ralph Klein, which fraudulently promised lower prices, Alberta was the first Canadian province to implement a deregulated electricity market, completed in 2001. This deregulated system has caused volatility in the price of electricity, kept consumer prices high, and maximized profits to generating companies. Generating companies can use such strategies as holding back production to raise prices. In April 2013, a Fraser Institute study found that Calgary ranked third and Edmonton fourth in Canada compared to other cities in terms of high electricity bills, and that Alberta businesses pay some of the highest electricity prices in North America.

Benefits from deregulation specifically accrued to the private oilsands monopolies, which are the most powerful private entities in Alberta. It boosted the ability of companies to construct their own power stations to supply both heat and electricity (called co-generation) for mining and upgrading in Fort McMurray. Each time another plant is built, the companies generate more electricity than they can use with co-generation. According to U.S. energy analysts, some firms produce ten times more power than needed.

The excess electricity from co-generation has resulted in demands from energy monopolies to build public transmission lines so they can sell electricity in the U.S. Private projects would not see a high enough return apparently. An example was a private project of the big energy infrastructure firm TransCanada, which did not proceed. TransCanada wanted a multi-billion dollar high voltage direct current transmission line to export 3,000 MW of surplus power from Fort McMurray to the U.S. Pacific Northwest. The province's plan to build $16.5 billion worth of transmission lines or eight times what now exists could be seen as fulfilling the request of the energy monopolies at the expense of the public purse.

A 2010 report by the Oil Sands Developer's Group cites the province's 2009 Bill 50, the Electric Statutes Amendment Act, as a critical facilitator to allow power exports from the province.

The people of Alberta are now familiar with the negative effects of the deregulation of electricity. The undermining of a public authority that is supposed to protect the people's access to a reliable supply of electricity and other necessary features of a modern society has served monopoly right. The essence of Alberta's measures to deregulate electricity, the private monopolization of all aspects of the energy industry, and the expected approval of the sell out of ownership of a major part of the electricity grid to the foreign monopoly Berkshire Hathaway wrecks any public authority that serves to protect the well-being and security of Albertans and restrict monopoly right. The challenge people face is to unite to stop and turn around this anti-social direction of the Alberta government that puts the demands and narrow private interests of the global monopolies ahead of Albertans and the public interest. Upholding public right and restricting monopoly right are important features of a new direction for Alberta's economy and politics.

Note

1. TransAlta was founded as Calgary Power in 1911 by a private syndicate that included Max Aitken Lord Beaverbrook and R. B. Bennett, later Prime Minister of Canada.

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